Determinants of tourism small and medium enterprises financial performance

This study develops and tests a structural model that incorporates the determinants of SME financial performance in Mauritius. Data were collected from 384 tourism SME owners using a structured questionnaire. The results indicate that managerial capability has a significant positive effect on SME performance and is in turn influenced by managers’ autonomy and competence. The study does find a significant relationship between innovation capability and SME performance. Given the socio-economic importance of SMEs to the Mauritian economy, the results provide crucial information to government and policy-makers that can used to develop macro-economic policies that increase their contribution to the socio-economic development of the country. For entrepreneurs, the study provides insights on areas of interventions that can lead to an improvement in the financial performance of their organisations. Despite the study limitations, it contributes to a theoretical understanding of the determinants of financial performance in African economies.